Keycorp · NYSE:KEY
Keycorp — Keycorp /New/ — Q4 2008 Earnings Presentation
25 slides from Keycorp's earnings presentation, Jan 22, 2009
Slide 1: Fourth Quarter 2008 Review
Fourth Quarter 2008 Review January 22, 2009 Speakers: Henry Meyer Jeff Weeden
Slide 2: Forward-Looking Statement Disclosure
3 PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 FORWARD-LOOKING STATEMENT DISCLOSURE This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements about our financial condition, results of operations, earning
Slide 3: Significant Actions - Fourth Quarter 2008
5 Significant Actions-Fourth Quarter 2008 Strengthened capital / funding position $2.5 billion capital issuance - U.S. Treasury's Capital Purchase Program Reduced fourth quarter dividend from $0.1875 per share to $.0625 per share Issued $1.5 billion new debt under FDIC's Temporary Liquidity Guarante
Slide 4: Financial Summary - Fourth Quarter 2008
7 Net loss per common share $ (1.13) Significant Items Included in Net Loss Noncash charge for goodwill impairment $ (0.85) Loan loss provision in excess of net charge-offs $ (0.32) U.S. tax on accumulated earnings of Canadian leasing operations $ (0.14) Net credit from settlement of leveraged leasi
Slide 5: Net interest income and margin
9 (a) During the fourth quarter of 2008, Key's taxable-equivalent net interest income was reduced by $18 million as a result of an agreement reached with the IRS on all material aspects related to the IRS global tax settlement pertaining to certain leveraged lease financing transactions. Excluding t
Slide 6: Average loans by portfolio
11 3Q07 4Q07 1Q08 2Q08 3Q08 4Q08 Exit Portfolios 8.3 8.7 8.2 10.7 9.9 9.6 Other Consumer 3.3 2.9 3.3 3.987 4.023 4 Home Equity 9.7 9.7 9.7 9.8 9.9 10 Other Commercial 10.2 10.3 10 9.8 9.6 9.2 Commercial Real Estate 17.142 15.3 17.2 17.5 17.5 17.5 Commercial & Industrial 19.1 22.8 24.3 24.9 25.3 26.6
Slide 7: Average Deposits
13 4Q07 1Q08 2Q08 3Q08 4Q08 Foreign Deposits 5.721 5.9 4.121 2.761 1.3 CD's > $100K 6.888 8.072 8.67 9.506 11.3 CD's < $100K 11.454 12.7 12.7 13.1 14.5 Savings 1.5 1.9 1.8 1.8 1.7 NOW/Money Market 25.7 27 27.7 26.7 24.9 DDA 12.9 10.7 10.6 10.7 10.9 Total 58.5 60.4 61 61.8 63.3 DDA NOW/MMDA Savings C
Slide 8: Asset quality trends versus peers
15 3Q06 4Q06 1Q07 2Q07 3Q07 4Q07 1Q08 2Q08 3Q08 4Q08 NCOs to Average Loans - Key 0.0026 0.0033 0.0027 0.0032 0.0035 0.0067 0.0067 0.0275 0.0143 0.0177 NCOs to Average Loans - Peer Median 0.0022 0.0033 0.0027 0.003 0.0034 0.0059 0.0071 0.0101 0.0127 Net Loan Charge-Offs to Average Loans Nonperforming
Slide 9: Credit Quality by Portfolio - 4Q08
17 Credit Quality by Portfolio-4Q08 (a) Net charge-off amounts annualized in calculation. N/M = Not Meaningful $ in millions
Slide 10: Commercial Real Estate Loans
19 Commercial Real Estate Loans December 31, 2008 (a) Segment NPLs are taken as a percentage of total Key NPLs. Total Key NPLs were $1,225 million at 12-31-2008. (b) Nonresidential land and development loans. (c) The percentages are calculated using total Key information for nonperforming loans, 90+
Slide 11: Residential Properties
Residential Properties: $2.15 Billion Commercial Real Estate December 31, 2008 21
Slide 12: Exit Portfolios
23 Exit Portfolios $ in millions, period-end data Total exit portfolio loans represent 12.3% of total loans and loans held for sale at December 31, 2008. Net charge-offs on exit portfolio loans represented 40.6% of total net charge-offs for the 4th quarter. Exit portfolio nonperforming assets repres
Slide 13: Capital Ratios
25 3Q07 4Q07 1Q08 2Q08 3Q08 4Q08 Tier 1 Capital - Key 0.0794 0.0744 0.0833 0.0853 0.0855 0.1081 Tarp Tier 1 Capital - Peer Median 0.0796 0.0751 0.0764 0.0822 0.0835 3Q07 4Q07 1Q08 2Q08 3Q08 4Q08 Total Capital - Key 0.1176 0.1138 0.1234 0.1241 0.124 0.1467 Tarp Total Capital - Peer Median 0.1155 0.11
Slide 14: Appendix
27 Appendix
Slide 15: Geographically Diverse Community Banking
29 Great Lakes Core Deposits: 33% Commercial Loans: 30% Home Equity Loans: 29% Northwest Core Deposits: 24% Commercial Loans: 28% Home Equity Loans: 29% Rocky Mountains Core Deposits: 8% Commercial Loans: 13% Home Equity Loans: 14% Northeast Core Deposits: 31% Commercial Loans: 21% Home Equity Loans
Slide 16: Community Banking Summary of Operations
31 TE = Taxable Equivalent; N/M = Not Meaningful; N/A = Not Applicable Community Banking Summary of Operations $ in millions
Slide 17: Community Banking Supplementary Information
33 Community Banking Supplementary Information (Lines of Business) $ in millions TE = Taxable Equivalent; N/A = Not Applicable
Slide 18: National Banking Summary of Operations
35 National Banking Summary of Operations (a) National Banking's results for the fourth quarter of 2008 include a $465 million ($420 million after tax) noncash charge for goodwill impairment. For the third quarter of 2008, National Banking's results include $54 million ($33 million after tax) of der
Slide 19: National Banking Supplementary Information
National Banking Supplementary Information (Lines of Business) $ in millions TE = Taxable Equivalent; N/M = Not Meaningful; N/A = Not Applicable Percent Change 4Q08 vs. 4Q08 3Q08 4Q07 3Q08 4Q07 Real Estate Capital and Corporate Banking Total revenue (TE) $161 $96 $160 67.7 % ..6 % Provision for loan
Slide 20: National Banking Supplementary Information
39 (a) From continuing operations National Banking Supplementary Information (Lines of Business) $ in millions TE = Taxable Equivalent; N/M = Not Meaningful; N/A = Not Applicable
Slide 21: Average Loans Continuing Operations
41 Average Loans Continuing Operations $ in millions N/M = Not Meaningful
Slide 22: Home Equity Loans
43 Home Equity Loans December 31, 2008 $ in millions, period-end data
Slide 23: Net Charge-Offs to Average Loans
45 Net Charge-Offs to Average Loans
Slide 24: Nonperforming Assets
47 Nonperforming Assets (a) Primarily investments held by the Private Equity unit within Key's Real Estate Capital and Corporate Banking Services line of business. (b) During the second quarter of 2008, Key transferred $384 million of commercial real estate loans ($719 million of primarily construct
Slide 25: Significant Items Impacting 4Q08 Results
49 Significant Items Impacting 4Q08 Results $ in millions, except per share amounts